BHUBANESWAR (Reuters) - Odisha has asked Steel Authority of India (SAIL), the country's largest domestic steel producer, to stop operations at Bolani iron ore mine after forest clearance expired on February 11, a government official said.

"It was a three-month temporary working permission. They have been asked to stop all kinds of mining activities till they obtain the clearance," U.C. Jena, Odisha's deputy director for mines, told Reuters.

The mine, which is spread over 1,321.45 hectares, prodcues 10 million tonnes of iron ore annually and supplies to several plants of SAIL. The state-run company has an annual steel prodcution capacity of 14 million tonnes.

A.K. Singh, chief communication officer at raw material division at SAIL, Kolkata, said the mining was likely to resume soon as the company hopes to obtain necessary clearance in two-three days.

"It is just a formality. Any day it will be cleared," Singh told Reuters.

SAIL is expected to boost its iron ore requirements by 68 percent to 39 million tonnes in 2013 from 23.25 million tonnes in 2010 to meet expansion needs.

Steel demand in India has suffered this fiscal year, with economic growth likely to decline below 7 percent in 2011/12, the slowest pace since the 2008 financial crisis, because of the central bank's inflation-fighting campaign and government gridlock.